Search smh:

Search in:

Debts ravage hospital service

Julie Robotham Medical Editor

SOME of Sydney's largest public hospitals frequently run out of medical supplies because they have debts of millions of dollars and the consultant PricewaterhouseCoopers has been called in to help stop the problem deteriorating.

The authority running western Sydney's public hospitals owes suppliers nearly twice as much as previously acknowledged, according to internal figures that reveal the dire state of its true financial position.

Doctors say unpaid bills mean hospitals frequently run out of supplies such as pathology chemicals and glucose tests for pregnant women, putting further stress on overworked staff.

As of Tuesday, the troubled Sydney West Area Health Service - which runs Westmead, Nepean and other hospitals across western Sydney and the Blue Mountains - owed $43.7 million in invoices unpaid for at least 30 days. This included $14.6 million invoiced 90 days or more earlier, according to the figures obtained by the Herald.

Advertisement

The amount is far in excess of the $27 million a spokeswoman said remained unpaid at the end of April. About 400 suppliers are understood to have negotiated arrangements with the service, allowing them to be paid later than normal 30-day trading terms.

PricewaterhouseCoopers had been appointed to "provide financial management support", an area spokeswoman acknowledged yesterday, in a sign that administrators are struggling to control their budgets.

The medical equipment supplier Synthes, which provides plates and pins for orthopedic surgery; the heart device supplier Medtronic and medical imaging company Olympus, are understood to be owed hundreds of thousands of dollars, and in one case more than $1 million. None of the companies would comment yesterday.

A Medical Technology Association of Australia spokeswoman confirmed Sydney West was still paying 54 per cent of its invoices after the 30-day due date - compared with a 43 per cent state average - though this had improved since January, when the Government ordered all area health services to reduce their debts.

The appointment of external financial management is in addition to an external inquiry into the management of Westmead Hospital and the area health service, ordered by the Government after doctors complained their clinical expertise was being overridden by bureaucrats.

According to a submission to that inquiry by Westmead's medical staff council, obtained by the Herald, staff morale was "at its worst point in the 30-year history of Westmead" as doctors and nurses distrusted management and were excluded from high-level decisions.

Andrew Pesce, the chairman of Westmead's medical staff council, said the hospital frequently ran out of important supplies, such as reagent chemicals for diagnostic tests and bottles of glucose to test for diabetes in pregnant women, after unpaid suppliers refused new orders. "There's no more fat left in the system. We can't make any more progress by trimming here and there and drawing out creditor payments," Dr Pesce said.

Nepean Hospital was forced to suspend elective surgery yesterday morning when it ran out of supplies of essential anaesthetic equipment. But the area spokeswoman said this was caused by, "inadequate stock management" that did "not relate to the withholding of stock by suppliers".

An inadequate supply of props to hold open patients' airways during surgery led doctors to halt surgery, resulting in several operations being delayed and one cancelled.

Dr Patrick Cregan, Nepean's clinical director of surgery, said the hospital was operating "on paper-thin margins". Supplies of equipment necessary for patient safety were constantly on the verge of running out and doctors were unable to get authorisation to order new stock, he said.